Loved it at $26 hate it at $18. (Forbes)
estimates Thursday, and the
company's outlook was solid but not outstanding. Nvidia forecast second-quarter
sales of about $1.01 billion or 5% sequential growth, which was higher than the
$992.4 million top line expected but in line with the pace analysts were
overarching competitive issues were discussed on the earnings call with
analysts Thursday. Nvidia executives said they expected the flat sales in its
core graphics chips to be offset by growth in its mobile-chip business in the
second quarter. But analysts questioned the company's assertion that the
momentum that its Tegra mobile chips had at the beginning of this year was
going to be as sustainable as the executives were forecasting. Specifically,
there have been reports that Texas Instruments' OMAP chip has won the reference
design for the next generation of Google (GOOG) Android phones running on Ice Cream Sandwich, the
upcoming version of the software.
In a better market environment the shares would have
popped $1. Instead they dropped $1.80. We are repurchasing our sale of
yesterday since we only sold because of our worry about the reaction to
earnings. Since earnings and forecast were positive we will go with management
and not the analysts.
May 12, 2011
Comment on Model Portfolio activity
We took short profits in Nvdia and Dell. Nvidia earnings come tonight and we would rather be
out than in for them. Dell is bouncing off its 12 month high and any market weakness may
take it back lower to rest the $15 level.
May 11, 2011
Comment on Model Portfolio activity
repurchased Yahoo in accounts to trade as it dropped 8% on the following news:
(Barron’s) Shares of Yahoo! (YHOO) are down
$1.39, or 7.5%, at $17.16, perhaps reflecting the company’s notice in a regulatory filing
last night that an aspect of its overseas investment is being restructured. In
its 10-Q filing with the Securities & Exchange Commission yesterday, the
company said part of Alibaba
Group Ltd., the China-based e-commerce venture in which Yahoo!
holds a 43% stake, is being split off into a separate property.
notes in its filing:
To expedite obtaining an essential regulatory
license, the ownership of Alibaba Group’s online payment business, Alipay, was
restructured so that 100 percent of its outstanding shares are held by a
Chinese domestic company which is majority owned by Alibaba Group’s chief
executive officer. Alibaba Group’s management and its principal shareholders,
Yahoo! and Softbank Corporation, are engaged in ongoing discussions regarding
the terms of the restructuring and the appropriate commercial arrangements
related to the online payment business.
Alibaba, along with Yahoo! Japan,
have been consistently seen as a goldmine for Yahoo! amidst the trouble in its
core business. Hence, perhaps some volatility in the stock whenever there’s any
perceived change in the nature of those investments.
Stocks cratered in response
the volatility in the commodities sector where Oil dropped $4 and Gasoline 40
pennies per gallon on news of an unanticipated inventory build. The
Oil/Gold/Silver trade is very crowded with hedge funds and mom and pop and that
affects stocks in that when margin requirements are raised or there are margin
calls some folks including big boys and girls have to sell stocks to raise
May 10, 2011
Comment on Model Portfolio activity
added to our Boston Scientific position after the shares dropped 10% in price
at midday on news that the CEO will retire in December. CEOs come and go.
Unless there is other news the drop was not warranted although it was good for
the CEO's ego but not the shares he holds.
May 9, 2011
Asia was slightly lower overnight
as is Europe at midday. Greece’s rating was lowered by S&P (yawn) but that
is the negative news of the start of trading that has the markets in neutral.
For some reason the 3% rally in the dollar over the past few days is also a
negative. But the drop is the dollar over the past year has been a negative. Go
figure. Oil is up $3 to $100 so the $4 per gallon local gas price only has to
drop 7% this week to meet the drop in the price of oil. Fat chance. Gold is up
$15 to $1506.
Easy come easy go:
(Huffington Post) Home values
fell 3 percent during the first three months of this year, for the biggest
quarterly drop since 2008, according to a new report from data provider Zillow.
Even as the stock market climbs to three-year highs, and as payrolls
tentatively expand, housing
continues to fall in almost every U.S. metro area. Prices won't find a bottom
until 2012 at the soonest, Zillow predicts, meaning American homeowners could
be in for at least another year of pain.
"Home value declines are
currently equal to those we experienced during the darkest days of the housing
recession," Zillow chief economist Stan Humphries said in a statement.
"With accelerating declines during the first quarter, it is unreasonable
to expect home values to return to stability by the end of 2011."
Even though the recession officially
ended in June 2009, the real estate market has yet to hit bottom. Since the
peak in 2006, home values nationally are down 29.5 percent, Zillow says.
Compared to this time last year, prices are down 8.2 percent nationally.
economy added 1.3 million private-sector jobs between February 2010 and January
2011, and the headline unemployment rate edged downward,
from 9.8% to 8.8%, between November of last year and March. It inched
upward in April, to 9%, but tempering that increase was the
news that the economy added 244,000 jobs last month (not
including those 62,000 McJobs), beating economists'
Under this somewhat sunnier
news, however, runs a far darker undercurrent. Yes, jobs are being created, but
what kinds of jobs paying what kinds of wages? Can those jobs sustain a modest
lifestyle and pay the bills? Or are we living through a McJobs recovery?
The evidence points to the
latter. According to a recent analysis by the National Employment Law Project
(NELP), the biggest growth in private-sector job creation in the past year
occurred in positions in the low-wage retail, administrative, and food service
sectors of the economy. While 23% of the jobs lost in the Great Recession that followed
the economic meltdown of 2008 were “low-wage” (those paying $9-$13 an hour),
49% of new jobs added in the sluggish “recovery” are in those same low-wage
industries. On the other end of the spectrum, 40% of the jobs lost paid high
wages ($19-$31 an hour), while a mere 14% of new jobs pay similarly high wages.
As a point of comparison, that's much worse than in the recession of 2001 after
the high-tech bubble burst. Then, higher wage jobs made up almost a third of all new
jobs in the first year after the crisis.
The hardest hit industries in
terms of employment now are finance, manufacturing, and especially
construction, which was decimated when the housing bubble burst in 2007 and has
yet to recover. Meanwhile, NELP found that hiring for temporary administrative
and waste-management jobs, health-care jobs, and of course those fast-food
restaurants has surged.
Indeed in 2010, one in four
jobs added by private employers was a temporary job, which usually provides
workers with few benefits and even less job security. It's not surprising that
employers would first rely on temporary hires as they regained their footing
after a colossal financial crisis. But this time around, companies have taken on temp workers
in far greater numbers than after previous downturns. Where 26%
of hires in 2010 were temporary, the figure was
11% after the early-1990s recession and only 7% after the downturn of 2001.As
many labor economists have begun to point out, we're witnessing an increasing polarization of the
U.S. economy over the past three decades. More and more, we're seeing labor
growth largely at opposite ends of the skills-and-wages spectrum -- among, that
is, the best and the worst kinds of jobs.
placed a $367 million bet on a novel technology for wireless chips to help
build its foothold in smartphones and tablet-style computers.
Silicon Valley chip maker on Monday struck an all-cash deal for Icera Inc.,
a start-up in Bristol, England that has spent nine years pursuing an unusual
programmable technology for what the industry calls baseband communication
a specialist in computer graphics, has added microprocessor technology to
compete in mobile devices—but also needs baseband capability to match rivals
such as Qualcomm Inc. and Intel Corp.
a result of this acquisition we have two of the most important processors in
mobile computing," said Jen-Hsun Huang, Nvidia's
chief executive, in an interview.
companies add special circuitry for each set of communications protocols.
Icera, by contrast, designed more general-purpose processors that use software
to handle different wireless standards.
means the same chip could work on 2G, 3G and 4G cellular networks, for example,
and be upgraded to handle new features. Each piece of silicon also tends to be
smaller, a savings in space and manufacturing cost, Icera says.
founded in 2002, raised some $250 million in venture capital over the years.
Stan Boland, its president and chief executive, says the company started out
with accessories known as dongles that help laptop computers connect to
wireless networks. He said Icera is just starting to deliver samples of its
chips aimed at cellular handsets.
Thelander, an analyst with Signals Research Group, said his firm recently
conducted tests that found Icera's technology was within "spitting
distance" of market leader Qualcomm's. But he believes Icera has struggled
to get accepted by cellphone makers, because of concerns about its size and
a result of the deal, Mr. Thelander said, Icera has the backing of a big-name
company and Nvidia gets the baseband capability it needs to offer customers a
more complete bundle of technology. "It's really a win-win-win," he
Huang said Nvidia still expects its chips to work alongside baseband processors
from other companies, when customers prefer it. Meanwhile, having an in-house
baseband technology makes it more feasible to create products that combine a
microprocessor and baseband on one piece of silicon.
smartphones and tablets now keep those functions separate, Mr. Huang noted, but
such integrated products are at least a theoretical possibility as a result of
the deal. "We don't have any plans at the moment, but we certainly have
the ability to do it," he said.
which reports its fiscal first-quarter earnings on Thursday, said Monday it
sees the deal slightly trimming its operating profit through the first half of
the 2012 calendar year, and adding to it in the second half of next year. The
deal has been approved by both companies' boards and is expected to be
completed in 30 days.
gained $5 so any gasoline price changes are off. Sorry. Gold regained $16. The
major market measures traded higher most of the day with little conviction-
also known as no volume. Breadth ended the day positive.
May 6, 2011
Oil is down another $2 to $97 and
Gold is weak but only down $2 as the trading day begins. Asia was mixed
overnight and Europe is higher at midday as markets await the Employment
U.S. economy adds 244,000 jobs in
April; unemployment rate is 9%. Total private payrolls increased 268,000 which
is the largest monthly increase since April 2006. The numbers were better
than and the major market measures are higher on the news.
When you know what your customers
(WSJ) J.P. Morgan Chase
& Co.'s trading activities recorded a net gain in every trading session for
the first quarter, the company said in a filing early Friday.
The bank, the second-largest
U.S. bank by assets behind Bank of America Corp.,
said the so-called perfect quarter included average daily revenue of $112
million in the trading operations. Seven days in the period, which ended March
31, had more than $160 million in revenue.
J.P. Morgan had posted a
perfect quarter in the fourth quarter, as well, but Jes Staley, the head
Morgan's investment bank, said at the time he didn't expect that to continue. Mr.
Staley, when revealing the fourth quarter's performance at the bank's investor
day said, "I fully expect trading loss days to come back."
For 2010, the bank had a daily
net loss only eight times, all in the second quarter. In 2009, the bank had 42
days of losses and it had 97 in 2008.
Bank of America also said
it posted a perfect quarter during the first three months of the year.
switched Barnes & Noble with a nice short profit to Aéropostale.
to a new USA Today analysis, personal taxes — including federal and local — are
at their lowest level since 1958:
Americans are paying the smallest share of their income for taxes since 1958, a
reflection of tax cuts and a weak economy, a USA TODAY analysis finds. The
total tax burden — for all federal, state and local taxes — dropped to 23.6% of
income in the first quarter, according to Bureau of Economic Analysis data. As McClatchy’s
Kevin Hall wrote yesterday, “At a time when Washington is wrestling with how to
end federal budget deficits and trim the national debt — huge questions that
are expected to dominate the nation’s politics through the 2012 elections — the
fact that Americans are
under-taxed compared with U.S. historic norms is central to
the discussion.” The USA Today analysis shows that if tax receipts today were
at the level they were through the 70′s,
80′s and 90′s, that would eliminate “one-third of
the estimated $1.5 trillion federal deficit this year.”
The major market measures were up
over 1% after three hours of trading when a rumor swept to internet that Greece
was leaving the Euro-Zone- or maybe not- or maybe would default or maybe who
knows. The major measures quickly lost two/thirds of the gain as the HFT kids
pushed their buttons before stabilizing at lower levels. And so goes investing
in the world of High Frequency Trading.
major market measures managed to hold some gains into the
close in light trading. Breadth was 2/1 to the good. The S&P 500 closed at
1340 support/former resistance.
May 5, 2011
debt relief to people that really need it, that's what foreclosure
is."[Homeowners] are probably better off going somewhere else, because
they get relieved almost 100% of the debt through foreclosure." Jamie
Dimon, CEO of JP Morgan.
The market measures are lower pre-opening as
Jobless claims jumped to 474,000 when 400,000 were expected. Oil has a $106
handle and Gold is back down to $1500 as the trading day begins. European
bourses are 1% lower at midday and Asia was mixed small overnight.
As we were just saying:
(WSJ) In the first four months
of this year, average daily trading volume of stocks listed on the New York
Stock Exchange and Nasdaq Stock Market is down 15% from 2010's pace, running at
an average rate of 6.3 billion shares a day. Volume has been edging lower
throughout the year, with April's daily average of 5.8 billion shares marking
the slowest month since May 2008.
"The ripple effects
across trading from the lack of fundamental demand are very real," said
Jose Marques, global head of electronic equity trading at Deutsche Bank AG.
Volume had marched higher for
most of the last decade, escalating during the financial crisis. It doubled
between 2006 and March 2009, when an average of nine billion shares changed
hands every day.
A big reason for the decline
in volumes has been a general quieting of the big swings in stock prices
commonly seen from 2008 through the first half of 2010. That has been reflected
in a decline in the Chicago Board Options Exchange volatility index, also
called the VIX, which last month fell to its lowest level since July 2007.
The declines in volatility
and volume have been bad news for high-frequency traders, whose
strategies generally rely on squeezing profits out of the tiny differences
between the buy and sell orders of stocks within a fraction of a second.
High-frequency traders also act as liquidity providers in the market, often
taking the other side of a trade from long-term investors.
General Motors Co.
said Thursday its net income tripled in the first quarter due to stronger
vehicle sales and sales of assets, including its stake in Delphi Automotive
said net income rose to $3.2 billion or $1.77 a share, from $865 million or 55
cents a share, beating analyst estimates of about 93 cents a share. Operating
profit, reflecting the strength of its core automotive business, increased to
$2 billion from $1.7 billion. Revenue increased 15%, to $36.2 billion, from
Aéropostale (NYSE: ARO) reports total sales for Q1 were $469.2 million, up
1 percent from the same period last year. Same store sales down 7 percent. ARO
lowered its Q1 EPS guidance from 35-38c to about 20c. The Street was looking
for quarterly EPS of 37c. We
repurchased shares as the stock price fell $3.80 on the news. We have traded
ARO profitably for past few years.
Diane Swonk, Chief
Economist Mesirow Financial:
Productivity Growth Slows; Unemployment Claims Surge
Productivity growth slowed to
a 1.6% pace in the first quarter and 1.3% compared to a year ago. This helps
explain why net hiring has improved, but not enough to prompt workers who were
sidelined by the recession to throw their hats back into the ring and rejoin
the labor force.
In a related development, unit
labor costs rebounded after contracting in the fourth quarter, but remain
limited. This, along with rising input costs has put a bit of a squeeze on
profit margins. The exception is the manufacturing sector, where productivity
growth rose at a 6.3% pace and unit labor costs continued to plummet. Indeed,
our manufacturing workers are easily the most productive in the world, a fact
too often overlooked by those predicting the end of American manufacturing.
claims surprised many and surged by 43,000 to 474,000 at the end of April.
Several factors contributed to the rise, not least the disruption in Japanese
production and a new extension of unemployment benefits in Oregon. That said,
it is hard to ignore the fact that claims have been trending in the wrong
direction - up instead of down - in April. This coupled with some renewed
concern about the European debt crisis, which marked the start of a slump in
growth last spring and summer, is not exactly reassuring.
Today marks the infamous "flash crash" of a year ago. Although the
U.S. economy appears to be on more stable footing than it was then, it provides
a useful reminder of how weak the recovery still is. Labor markets are taking a
particularly long time to heal. Some of the weakness is transitory, but that
provides little solace for those who are now running out of employment
Silver is down $3 today and
25% in price since last Friday. Oil is down $6 to $102 which may be related to
some trapped longs in Silver.
the Government Employment Report for April will please either the bulls or
bears or maybe no one. Today’s market action is being influenced by the
devastation being experienced by commodities bulls who are getting their lunch
and dinner handed to them on a silver platter.
major measures closed down 1% and more in moderate trading. Breadth was 3/2
negative. And tomorrow is another day. Oil closed down 10% today at $98. Maybe
gasoline prices will drop 10%. Not. Gold lost $46 to $1468 and Silver ended at
May 4, 2011
Asia was mildly lower overnight
and Europe is mixed at midday. Gold is down $8 and Oil has a $110 handle with
U.S futures flat as the trading day begins. ADP suggests 179,000 jobs were
created in April which is lower than hoped. The Government number comes Friday
for the big boys and girls to have their fun.
Diane Swonk, Chief Economist
ADP Employment Falls Short of Hope
The ADP report on private
sector employment rose by 179,000 in April, less than expected, as hiring
cooled slightly in the face of higher energy prices and the associated
political uncertainty in oil-producing countries. Gains were concentrated in
small and mid-sized firms. We are beginning to see the payoff from the surge in
initial public offerings (IPOs) at the end of 2010, which is creating a
tailwind. Young firms, in particular, which are often counted as small
businesses, are finally hitting a critical mass and hiring. Facebook and its
plan to hire more than 20,000 workers, more than McDonalds is just one example.
Indeed, gains in the service
sector, which includes many emerging companies, far outpaces gains in
manufacturing. Hiring in the manufacturing sector is still on the upswing for
both blue- and white-collar workers.
Bottom Line: Today's ADP
report, coupled with some disappointing increases in jobless claims in recent
weeks, suggest that the "official" report on payroll employment for
April will also disappoint on Friday. Public sector layoffs, in particular, are
expected to remain elevated and add to the headwinds for private sector
employment, which also moderated a bit over the month.
May 2 we mentioned that margin retirements on Silver had been raised to $16,200
per contract. We neglected to mention that the contract controlled 5000 ounces of
silver and thus was worth $250,000 when silver was at $50 an ounce last week.
Today with silver at $39 an ounce that one tract is worth $195,000. If a
speculator had put up the minimum of $14,000 required last week that speculator
would be wiped out and owe $41,000.
The major market measures are 1%
lower at midday with the S&P near support and former resistance of 1340.
major market measures closed lower in usual trading. Breadth was negative and
the financials were for sale all day.
May 3, 2011
Asia and Europe were lower
overnight. Gold is $1544 and Oil has a $112 handle as the trade day begins. U.S
stocks opened lower but re flat lining after one half hour of trading.
FBR Capital reiterates an 'Outperform' on Fifth Third Bancorp
(NASDAQ: FITB), PT $17. FBR analyst says, "NPAs declined in
the C&I, construction, and residential portfolios, but there was a slight
tick up in CRE NPAs. The modest increase in CRE NPAs prevented a more
meaningful increase in reserve releases from $190M in 4Q10. This is likely a
result of the company's continuing drag from its Michigan and Florida CRE loan
portfolio. On the earnings front, pre-tax, pre-provision earnings also declined,
but should be sustainable through FY11 as mortgage banking bounces back
slightly from a poor quarter. With a strong capital base and relatively
attractive valuation of 9.7x FY12E EPS, FITB should be positioned to outperform
when it starts to put its capital to work. We are increasing our FY11 operating
EPS estimates to $1.20 from $1.05 due to the current quarter's results and
lower provisions and maintaining our FY12 operating EPS estimate of
reason NVDA is down this morning is this story on thestreet.com which is old
new news: The new desktop iMacs feature Intel's new 32-nanometer technology,
which uses quad core processors and a Turbo Boost feature to crank up the
computing speeds. The iMacs also house the Thunderbolt -- a speedy variation on
the USB and FireWire data connections -- that was developed for Apple by Intel.
Prices of the iMacs range from $1,200 to $2,000 and each option includes the
Sandy Bridge quad-core chip.
move, though expected, is a welcome endorsement for Intel, after the chip maker
got off to a rocky start earlier this year when it had to recall the
first shipments of its new
processors. And while Apple embraced Intel for its computing processors, it
also put AMD in the inner circle by choosing its ATI Radeon graphics processors
for all the iMacs.
This chip choice is bad news for graphics chip rival Nvidia which had been
in previous versions of the iMacs.
Morgan Stanley Joins Funds
Buying Commodities as Goldman Sachs Says ‘Sell’:
can’t be that lucky.
May 3, 2011 10:26 AM EDT
of Alcoa, Inc. (NYSE: AA) are higher in early trading Monday on
unsubstantiated takeover rumors. While Alcoa has been the target of takeover
speculation in the past, today's rumors appear to have originated with trading
sources and likely have little merit. Nonetheless, shares of AA are up 2.5
percent to $17.65. Yesterday, Goldman Sachs
upgraded shares of AA to Buy,
citing improving supply chain dynamics. In addition to today's rumors, the
stock could be seeing follow-through from this bullish call.
UPDATE: Reuters reported that the rumored suitor for Alcoa (NYSE: AA) is Rio Tinto (NYSE: RIO). According to traders, rumors are they secured a
$US25 billion syndication loan to acquire Alcoa for $US25.5 per listed share.
And so how do you tell your
wife not to go shopping?
A rookie trading card for Wayne Gretzky sold to an anonymous
bidder for $94,163, a record for a hockey card, SCP Auctions, Inc.
said on its website. Hall of Famer Gretzky, 49, holds National Hockey League
records for goals, assists and points. He led the Edmonton Oilers to Stanley
Cup championships in 1984, 1985, 1987 and 1988 and retired in 1999.
GM sales up 24% in April;
Chrysler’s up 22%; and Ford’s were up 16%.
major market measures closed lower with the S&P down 0.5% and NAZZ losing
.75% while the DJIA was positive at the close on programs. Financials had a bid
all day and breadth was flat with volume light as usual. Maybe light volume is
May 2, 2011
Oil is down $1 and Gold is flat
as the trading day begins. Asia was higher although China was closed and Europe
also is firm. U.S. futures indicate a higher opening. Talking heads are giving
the death of Bin Laden as the reason for the positive tone.
are adding Alcoa to accounts. We traded for profit last year and then it got
away from us. We are buying gingerly because it has been volatile for the last
three years. It has a huge amount of debt which offers earnings leverage but
that leverage goes both ways. (StreetInsider.com)Goldman Sachs upgraded
Alcoa (NYSE: AA) from Neutral to Buy and raised their 6-month price
target from $17 to $22, citing improving supply chain dynamics. The firm
states, "We view the structural industry change, driven by the de-linking
of alumina from the aluminum price, as a potential major long-term contributor
to Alcoa, which is the largest global third-party alumina seller." Goldman
is also positive on the cyclical upturn in the aerospace cycle. The firm sees
Alcoa earnings $1.40/$1.65 in 2011/2012, up from $1.10/$1.25, and about 6%/11%
higher than consensus. The firm said Alcoa can earn $1.95 on a normalized
Friday we added Microsoft to accounts after it sold off even though earnings
and sales were above expectations.
(briefing.com) Microsoft (MSFT $25.89 -0.82) reported third
quarter earnings of $0.61 per share, including a $0.05 tax benefit primarily
related to an agreement with the IRS to settle a portion of their audit of tax
years 2004 to 2006, $0.05 better than the Thomson Reuters consensus of $0.56.
Revenues rose 13.3% year-over-year to $16.43 billion versus the $16.19 billion
Business Division revenue grew 21% year-over-year. Server & Tools revenue
grew 11% year-over-year, the fourth consecutive quarter of double-digit growth.
Online Services Division revenue grew 14% year-over-year primarily driven by
increases in search revenue. Bing's US search share increased to 13.9% this
quarter. Entertainment & Devices Division grew 60% year-over-year, fueled
by Kinect for Xbox 360, the fastest-selling consumer electronics device in
history, continued strong Xbox 360 console sales and growth of Xbox Live.
reaffirmed its operating expense guidance of $26.9 billion to $27.3 billion for
the full year ending June 30, 2011. Microsoft also offers preliminary FY12
operating expense guidance of 3% to 5% growth from the mid-point of fiscal year
2011 guidance or $28.0 billion to $28.6 billion. Office had another huge
quarter, again exceeding everyone's expectations, and the addition of Office
365 will make our cloud productivity solutions even more compelling. We
continue to see strong adoption of our cloud-based services among the Fortune
also added Goldman Sachs to a few larger accounts for a trade.
Back during the Hunt Silver
corner in 1979 the Commodities exchanges first raised margin requirements and
then allowed no more opening positions in silver. In effect the exchanges
changed the rules. The same may happen again. The house never loses and if
someone knows when the house is going to change the rules they can make a lot
(Bloomberg) Silver prices fell
sharply Monday after CME Group hiked the amount of cash needed to hold
speculative positions in the metal, while gold declined on news that al Qaeda
leader Osama bin Laden had been killed in a U.S.-led operation in Pakistan.
Initial margins increased to $14,513 a contract from $12,8525, effective from
the close on April 29, CME, parent of the Chicago Board of Trade and Chicago
Merc, said in a statement.
Diane Swonk, Chief Economist
Construction Bounces Back;
Manufacturing Remains Robust
Construction spending increased
a stronger-than-expected 1.4% in March after losing ground in February, but
gains remained uneven. Residential construction actually increased, but
compared to very low levels. There were also some increases in commercial and
public construction. Transportation was off compared to March of last year;
much of that activity is funded by state and local governments, many of which
are cutting everywhere that they can to offset revenue shortfalls. Not
surprisingly, construction on educational buildings was also curtailed compared
to last year, a harbinger of cuts in the pipeline for teachers as well.
Separately, the Institute for
Supply Management (ISM) manufacturing index decreased to 60.4 in March, but
remained well above levels consistent with robust manufacturing activity. Order
backlogs, in particular, improved as many tried to stockpile inventories ahead
of commodity-led price increases. Manufacturers were divided, however, on their
ability to pass on higher input costs and many complained of the toll those
higher input prices took on profit margins. Manufacturers engaged in exporting
were better able to pass along price increases to foreign buyers, who are
experiencing stronger economic growth.
Bottom Line: The
economic and political news today looks a little better than it did last week.
There is a sense of relief. Nothing, however, can bring back the nights of
sleep lost during the height of the financial crisis or during the months after
9/11. I hope the events of the last two days provide some sense of closure to
those who suffered and give our troops the purpose and validation they deserve
in serving our country.
sold Yahoo for an almost $3 gain and placed part of the profit in Talbots
warrants. They are our 4 year – so far not so good speculation – on
Talbots eventually recovering.
major market measures couldn’t hold their Osama is dead gains and closed
mildly lower on the day in light trading. Breadth was
negative at the bell. Gold ended at $1544 and Oil was $113.14.
We plan on being in business for at least the next twenty years
and with this in mind we are changing the frequency and content of our internet posts. We will maintain our
concentration on market activity while we simplify our business day. We have been writing about the markets
for 27 years - on a daily basis for 12 years - and giving investment advice for 45 years. Our guess is that
while we haven’t seen and said it all we are pretty close to having exhausted any new words of wisdom
we might wish to convey. Markets don’t repeat but they do rhyme. By not posting dally we will be
freed up to do some summer/winter activities such as gardening/snowshoeing, riding our horses,
walking the dogs and spending a bit more time with the prince and princess when they visit. And
so we are going to end our lengthy daily comments but we will continue to post periodically when
market events warrant and/or when there is activity in the Model Portfolio.
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For those folks who have accounts with us, you may now go to:
and fill out the account information and view your accounts online. If you
have trouble filling out the form, or in getting online, call and we will
help you with the process. NASD regulations require the eview
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You will be prompted to make this change when needed.
For information on Mesirow SIPC and Excess SIPC protection SIPCmesirow.pdf.
For those clients of LY& Co and other
interested persons the Quarterly Report on the routing of customer orders under
All future SEC Rule11Ac1-6 Quarterly reports may be found by visiting the diclosures at LY& Co Clearing Broker Mesirow Financial at:
Annual offer to present clients of Lemley Yarling Management Co. Under Rule 204-3 of the SEC Advisors Act, we are pleased to offer to send to you
our updated Form ADV, Part II for your perusal. If any present client would like a copy, please don't hesitate to write, e-mail, or call us.
A list of all recommendations made by Lemley Yarling Management Co. for the preceding one-year period is available upon request.
Summary of Business Continuity Plan